The Litigation Process
This article sets out a general overview of the litigation process in England and Wales under the Civil Procedure Rules (CPR), including steps to be taken before a claim is commenced. It does not cover every possible stage of the process, but highlights those which are likely to apply.
As each case is different, the particular steps required, whether a particular protocol applies and the timetable to be followed, will depend on the facts, circumstances and the dispute. There are also factors that cannot be predicted in advance, such as actions taken by the other side, evidence that emerges during the case and directions or orders given by the court. The following summary is intended to give a general indication of the procedure and steps that may be required.
The overriding objective
One important principle that underpins litigation in the English courts is the “overriding objective” of enabling the court to deal with cases justly and at proportionate cost. The key factors include:
- Enforcing compliance with the CPR and any court orders.
- Dealing with a case in a way that is proportionate to the amount of money involved, importance, complexity of the issues and the financial position of each party.
- Saving expense.
- Ensuring that the case is dealt with expeditiously and fairly.
These factors must be borne in mind at each step of the litigation process. As part of its case management powers, the court may impose penalties on any party that does not comply with the court rules or orders. These penalties can include costs sanctions or striking out all or part of the evidence or claim.
The courts will expect potential parties to act reasonably in exchanging information and documents relevant to the dispute before proceedings are even commenced. The aim is to avoid the need for legal proceedings where possible. There can be adverse costs consequences if a party fails to follow the relevant pre-action procedure.
To ensure compliance with the courts’ guidelines, it is normal to send a “letter before claim” to the potential defendant. This letter sets out the details of the claim and the remedy sought and lists the key documents relevant to the dispute. It may include a request for documents or information from the defendant. The letter should also invite the defendant to agree to some form of alternative dispute resolution (ADR) procedure, such as mediation.
It is normal to allow the defendant a reasonable time to respond to the letter before claim. Depending on the response, it may be appropriate to issue proceedings, or to continue correspondence with the defendant.
Statements of case
Each party to the proceedings must prepare certain documents that contain the details of the case they wish to advance. These documents (the statements of case) must be filed at court and served on the other party.
Proceedings are started by issuing a claim form at court and paying the required court fee. The claim form contains a concise statement of the nature of the claim and the remedy sought (for example, damages). It must also include a statement of value of any money claim.
The particulars of claim set out full details of the claim, including the alleged facts on which the claim is based.
The defendant must file an acknowledgment of service within 14 days of service of the particulars of claim, if he does not file a defence at this time.
Unless the defendant admits the whole of the claim, he must file a defence. In the defence, the defendant must state which allegations in the particulars of claim he admits, which he denies and which are neither admitted nor denied but he requires the claimant to prove. Where the defendant denies an allegation, he must state reasons for the denial and put forward his own version of events.
If a defence is not filed, it is possible to apply to the court for judgment in default of defence.
Depending on the factual circumstances, the defendant may make a counterclaim against the claimant, or an additional claim against another party to the claim or a third party. For example, he may make a claim for a contribution or indemnity from another party.
A counterclaim or an additional claim may be served with the defence without the court’s permission, or at any other time with the court’s permission.
Subsequent statements of case
For the claimant, it is possible to then file a reply to the defence, but there is no obligation to do so.
In principle, it is then possible for there to be further statements of case, such as a reply to the defence to counterclaim. In addition, a party may seek to amend its claim or defence, although it is likely to require the court’s permission to do so.
Statements of truth
Each statement of case must be verified by a statement of truth. This confirms that the person making the statement believes that the facts stated in the document are true. Statements of truth must also be signed in each witness statement and certain other documents filed in proceedings.
Interim remedies and final judgments without trial
There are certain procedures where it is possible to obtain a remedy or judgment before a trial. In some circumstances, this might avoid the need for a trial altogether. Some examples of interim remedies are mentioned below.
If the defendant fails to file an acknowledgement of service or defence within the relevant time limit, it may be possible to obtain a judgment in default of defence, which means that judgment is entered on the claim without a trial.
Summary judgment is a means of obtaining judgment against the defendant at an early stage, avoiding the need to pursue the claim to trial. It may be appropriate to apply to court for summary judgment, either on the whole of the claim or on a particular issue, if it can be established that the defence has no real prospect of succeeding or there is no other compelling reason why the claim or issue should be disposed of at a trial.
Summary judgment may also be sought by a defendant on the grounds that there is no real prospect of the claim succeeding.
The court has the power to strike out a party’s statement of case (including a claim form, particulars of claim or defence), either in whole or in part, if the statement of case discloses no reasonable grounds for bringing or defending the claim the statement of case is an abuse of process or there has been a failure to comply with a rule or court order.
An injunction is an order that requires a party to do, or to refrain from doing, a specific act or acts. For example, a freezing injunction could be sought to preserve the defendant’s assets, pending judgment or final order, if there is a risk that the defendant will dispose of assets that would otherwise be available to meet his liability.
An application for injunctive relief is not a step that should be taken lightly. A claimant is usually required to give an undertaking in damages, that is, an undertaking to compensate the defendant for any loss incurred, should it later transpire that the injunction was wrongly granted.
After a defence has been filed, the court will serve a notice of proposed allocation to either the small, fast or multi track. Subject to the track case, the notice of proposed allocation will require the parties, by the specified date, to:
- Complete, file and serve a directions questionnaire.
- File proposed directions.
- Comply with any other matters such as filing and serving costs budgets.
The aim of the directions questionnaire is to provide information to assist the court in allocating the case to the appropriate track and in giving directions for how the case should be conducted.
The directions questionnaire must be filed by the date specified in the court’s notice of proposed allocation.
Case management conference
A case management conference (CMC) is a procedural hearing where the court gives directions for the future conduct of the case until trial. There may not be a CMC if the parties have agreed directions, or the court issues its own directions, and there is no other reason to have a hearing. The court may order that a further CMC be held, particularly in complex cases.
An interim application is made when a party seeks an order or directions before the trial or substantive hearing of the claim. An application may be made for a variety of procedural or tactical reasons, depending on the circumstances (for example, to seek an interim injunction, specific disclosure of documents or an extension of time to complete a procedural step).
If the other side makes any interim applications, it will be necessary to incur additional time and cost in responding to them. Any costs orders that the court makes in relation to an interim application may have to be paid during the course of the proceedings.
Settlement, Alternative Dispute Resolution and Part 36 offers
It is important to keep settlement in mind at all stages of the proceedings. The CPR and the courts encourage settlement of disputes in a number of ways; in particular, by the use of ADR or Part 36 offers to settle the case. Although the court cannot order the parties to enter into ADR, it may impose costs penalties on a party who unreasonably refuses to participate in a form of ADR. If there are any prospects of settling, it usually better to do so sooner rather than later, to avoid further legal costs.
To succeed in litigation, a claimant must prove his case on a balance of probabilities. It is necessary to adduce evidence to support each of the essential ingredients of the claim. The defendant will also need to adduce evidence to support his defence to some or all of the essential ingredients of the claim.
The evidence usually comprises:
- Contemporaneous documents (including electronic documents as well as hard copies) intended to prove the issues in dispute.
- Statements of factual witnesses, to tell the story behind the dispute and to fill in any gaps that the documents leave.
- Expert evidence (where appropriate and permitted), to assist the court when the case involves complex technical, academic or foreign law issues.
Disclosure of documents
The purpose of disclosure is for each party to make available documents which either support or undermine any party’s case. This may include documents that are harmful, sensitive or confidential. Disclosure is often a time-consuming and costly stage in litigation.
Initially, it will be necessary to identify:
- What documents exist (or may exist) that are or may be relevant to the matters in issue in the case.
- Where and with whom those documents are or may be located.
- The estimated cost of searching for and disclosing them.
Documents are disclosed by listing them and serving the list on the other side. It will be necessary to sign a disclosure statement in the list of documents, certifying understanding of the duty of disclosure and that, to the best of their knowledge, they have complied with that duty.
The most important point to note is to preserve all documents that are potentially disclosable, including electronic documents such as emails, voicemails and text messages. Care should also be taken to avoid creating any document that might damage the case, and to limit the circulation of existing documents relating to the dispute.
Inspection of documents and privilege
After the parties have exchanged their lists of documents, each party is entitled to inspect the other’s disclosed documents. In practice, inspection often takes place by way of exchange of copy documents.
Privilege entitles a party to withhold documents from inspection. In particular:
- Legal advice privilege protects confidential communications between a client and his lawyer that came into existence for the purpose of giving or receiving legal advice.
- Litigation privilege arises when litigation is contemplated, pending or in existence, and protects communications between a client or his lawyer and a third party, provided certain criteria are satisfied.
- Without prejudice privilege applies to communications made in a genuine attempt to settle a dispute.
If the claim proceeds, it will be necessary to prepare a written statement of the evidence that each individual intends to give to support the claim. These statements will be sent to the defendant, who will prepare and serve his own statements.
The time period for exchanging witness statements will be agreed by the parties or ordered by the court at the first CMC. The court may also give directions identifying the witnesses who may give evidence, or limiting the number of witnesses and the issues that may be addressed.
A witness statement must:
- Be in the witness’s own words, if practicable.
- Indicate which of the statements in it are made from the witness’s own knowledge and which are matters of information or belief and state the source of those matters.
- Include a statement of truth.
A witness may be called to trial to be cross-examined on his statement.
Expert evidence is used where the case involves matters on which the court does not have the requisite technical or academic knowledge, or the case involves issues of foreign law.
The court’s permission to call expert evidence is always required. If it grants permission, the court will limit the evidence to the named expert or field ordered and may specify the issues which the expert should address. The court may order that expert evidence is to be given by a single joint expert, namely an expert who is instructed on behalf of both parties.
Expert evidence is usually given in the form of a written report, which must be the independent product of the expert. The expert’s overriding duty is to the court and not to the party that instructed him. Where separate experts are instructed by the parties, reports are usually exchanged simultaneously, but may be exchanged sequentially.
Following the simultaneous exchange of expert reports, a party may put questions to the other party’s expert for the purpose of clarifying his report. Questions must normally be put within 28 days of service of the report. There is then likely to be a discussion between the experts for the purpose of reaching an agreed opinion on the issues where possible. An expert may give oral evidence at trial only with the court’s permission.
Preparation for trial
The courts are reluctant to postpone a trial date or period that has been fixed without a very good reason. Therefore, although most cases settle, it is important to be properly prepared in case the matter does proceed to trial. Some of the steps required are set out below.
The court may order that a pre-trial review (PTR) be held, particularly in more substantial cases where there are significant issues between the parties. The main purposes of the PTR are to:
- Check that the parties have complied with all previous court orders and directions.
- Prepare or finalise a timetable for the conduct of the trial, including the issues to be determined and the evidence to be heard.
- Fix or confirm the trial date.
Preparation of trial bundles
Trial bundles are files of the statements of case, relevant orders and key evidence that are used by the court and the parties during the trial. Preparing the trial bundles is usually the responsibility of the claimant’s solicitors but the court expects co-operation between the parties to try to agree the documents to be included. It can be a time-consuming task and requires significant planning and attention to detail.
Preparation of skeleton arguments
Each party will be required to supply the court and the other party with a written skeleton argument, namely a written outline of that party’s case and arguments before trial. Skeleton arguments are usually drafted by counsel.
Trial and judgment
- The length of the trial will depend on the complexity of the legal and factual issues to be resolved and the number of witnesses permitted to give evidence.
- The trial will be held in public, unless the court has ordered that it may be held in private because it involves matters of a confidential nature and publicity would cause harm or damage.
- The trial will normally be heard by a single judge alone.
- The judgment may be given immediately after the trial but is often “reserved” to a later date, particularly in complex matters. This means that the parties would not know the judge’s decision until sometime after the end of the trial.
The general rule regarding costs in litigation is that, if the claim succeeds, the claimant will be entitled to recover their costs from the defendant. On the other hand, if the claim fails, the claimant would be required to pay the defendant’s costs. However, the court has discretion to make a different costs order. The court will take into account factors such as the conduct of the parties and any Part 36 or other admissible offers to settle the case.
It is very unusual for a party to be able to recover all of the costs incurred in the litigation. The actual amount of costs to be paid is subject to an assessment process, unless the parties can agree the amount that will be paid. The standard basis of assessment is to allow costs to be recovered that were reasonably incurred, reasonable in amount and proportionate to the matters in issue. Costs which are disproportionate in amount may be disallowed or reduced even if they were reasonably or necessarily incurred.
If costs budgets are involved, the court will also take into account the party’s costs budgets for each stage of the claim. Each party is required to submit a costs budget and to revise it as appropriate as the case progresses. If a party’s actual costs exceed its budget, the excess may not be recoverable from the paying party.
The estimated costs of the litigation can be one of the most significant factors to consider when deciding whether to pursue a case.
Once judgment has been obtained, the judgment debtor should pay voluntarily any money owed under the judgment. If payment is not made, there are a number of enforcement procedures available to the judgment creditor to enforce payment. Examples include:
- Execution against goods owned by the judgment debtor, where an enforcement officer is commanded to seize and sell a judgment debtor’s goods.
- An attachment of earnings order, under which a proportion of the judgment debtor’s earnings is deducted by his employer and paid to the judgment creditor until the judgment debt is paid.
- A charging order over property owned by the judgment debtor.
The appropriate procedure will depend on the circumstances, including the nature and location of the debtor’s assets.
It is open to the unsuccessful party to apply for permission to appeal a judgment or order. A decision may be appealed only on the basis that it was either wrong or unjust because of a serious procedural or other irregularity in the proceedings. The general rule is that notice of an appeal must be filed within 21 days of the judgment or order (subject to certain exceptions).
If there is an appeal, it may be necessary to apply for a stay of any order or enforcement of the judgment.
This article is for general commentary only and does not constitute legal advice. If you would like to discuss any of the issues discussed in this article, please contact Sam Major – firstname.lastname@example.org , or another member of our team.
Cheyney Goulding LLP, solicitors in Guildford, Surrey